Sunday, December 7, 2008

Factory Closes in Chicago; Workers Invoke Bailout During Protest

Republic Windows and Doors closed its Chicago-based factory without giving workers the 60-days notice that federal law requires, according to a spokesperson for United Electrical Workers, which represents employees. A similar state law provision requires that workers receive 75-days notice.

The plant closing is both a sign of the vanishing United States manufacturing sector and the recent economic downturn. The company, which sells windows for use in home construction, has suffered tremendously due to the sluggish economic conditions, which are even bleaker in the housing market.

Employees, however, have decided to engage in creative protest. Since last Friday, they have occupied the factory and say they will remain inside unless the company promises severance and vacation pay. Employees also invoked the Wall Street bailout in their protests. Bank of America, a creditor of Republic Windows and Doors, canceled the company's line of credit, which apparently prevents it from paying workers. Employees used the situation to politicize the disparate levels of federal relief that financial institutions have received relative to manufacturing and other commercial sectors:

"Across cultures, religions, union and nonunion, we all say this bailout was a
shame," said Richard Berg, president of Teamsters Local 743. "If this bailout
should go to anything, it should go to the workers of this country."

Outside the plant, protesters wore stickers and carried signs that said,
"You got bailed out, we got sold out."
I think the workers made a great decision to bring the disparate treatment of "Main Street" and "Wall Street" to the table. Both parties and presidential candidates made decisions that favored monied interests. None can claim innocence.

Legal Issues: It is difficult to analyze legal issues from media accounts of this situation, particularly because the reports only present the opinion of the union. Furthermore, I have not located any analysis from labor law experts on this subject.

While the federal Worker Adjustment and Retraining Notification Act requires companies with over 100 full-time employees to provide notice to workers 60 prior to a shutdown or mass layoffs, it contains a couple of exceptions that could operate in this situation. The law does not require notification when a shutdown or mass layoff results from "unforeseeable business circumstances" that preclude timely notice. It also does not require notice from a "faltering company," when announcing a shutdown could hinder the company from seeking financing which would keep the business running.

The Illinois law on this issue contains similar exceptions. The media reports, however, do not permit a determination regarding the potential applicability of these exceptions.

Related reading: Dodd's Discriminatory Bailout: "Regime Change" for Main Street, But Not for Wall Street?


Aeneas said...

I don't know enough about the curlicues of the law in this case, and what I am saying is based on your post (although I have read the headlines on this), but I think the workers of that plant have a point, a very good point. This is not 'class warfare', but an issue of equity, of justice and of fairness. The reaction of these 'main street' Americans is an indication of the anger that is out there for what has been happening; for the billions upon billions spent by Congress on what looks to the 'great unwashed' (yah know, the people who occasionally come to visit their House and smell under Prince Reid's nose)their cronies on Wall Street and such august organizations as Fannie Mae. This does not sound very sophisticated and embelished with nuances, shades and erudition, but it is the bottom line. In two years there will be the equivalent of the storming of the Bastille and there will be a blood bath in the voting booths--the American people will vote out of the House and Senate all those bums who are now involved in this bailout . I can hardly wait for all those 'tricoteuse' in the American living room to look up to cheer when another congressional head rolls.

Perhaps that is why Hillary has taken the job of SOS. No one's job in the Senate or House is secure. The people are angry. Why, heck, I am angry as I sit in my armchair, sipping my bourbon and smoking my cigar (Just joking... never tasted bourbon in my life and I sure don't smoke.)

The prediction of an armchair, Baroque nihilist.

(Thought... may be I should also start a blog: The Musings of an Armchair Nihilist. :) Perhaps I'll get one visitor.)

Darren Lenard Hutchinson said...

You should definitely start a blog - as long as you visit this one too! But, yes, work on the name or you and I would be the only readers.

I am not a labor lawyer, but I did some research. I do know that most rights have conditions associated with them, and I recall the legislative discussion surrounding the plant closing legislation. One of the big concerns from industry was how giving notice could impact a company's ability to secure credit and stay afloat. Another dealt with a change in business dealings that a company could not reasonably contemplate.

Even if the company violated the law, if it goes into bankruptcy, then the workers, unfortunately, will have to wait for their money anyway. But the protest brings a very important issue to light.

Real Time Analytics